Entry and Exit in a Liberalised Market

32 Pages Posted: 1 Jun 2006

See all articles by Maria Jose Gil-Molto

Maria Jose Gil-Molto

University of Leicester - Department of Economics

Claudio A. Piga

Date Written: May 2006

Abstract

We analyze the entry and exit activity in the European Airline Markets in the post-liberalisation period and study the differential traits between traditional and low cost carriers. Alongside with the characteristics traditionally highlighted as determinants of entry (such as airport presence and network economies), we find that the existence of charter or seasonal operators, product differentiation opportunities and the level of quality provided by the incumbents are also relevant in explaining entry and/or exit. Despite the liberalisation policies, the contestability of important large markets still seems to be limited.

Keywords: Entry, Exit, Airlines, Conditional Logit, Europe, Low Cost

JEL Classification: L11, L93

Suggested Citation

Gil-Molto, Maria Jose and Piga, Claudio A., Entry and Exit in a Liberalised Market (May 2006). Available at SSRN: https://ssrn.com/abstract=905532 or http://dx.doi.org/10.2139/ssrn.905532

Maria Jose Gil-Molto (Contact Author)

University of Leicester - Department of Economics ( email )

University Road
Leicester, LE1 7RH
United Kingdom

No contact information is available for Claudio A. Piga

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